Prudential Outsources HR Systems To ExultPrudential Outsources HR Systems To Exult

Insurance and investment company Prudential Financial Inc. will outsource its human-resources information systems and administrative functions to business-process outsourcer Exult Inc. in a deal worth $700 million over 10 years.

The deal calls for Exult to handle all U.S.-based payroll, the HR call center, HR information systems and support, employee data, and records management for Prudential's 47,000 employees. Exult will also be responsible for Prudential's account's payable transactions. Exult, which uses Prudential's 401(k), is considering offering the retirement plan and other Prudential products to the employees of its other clients, including BP Amoco and International Paper.

Prudential executives declined to comment on the deal, but Exult chairman and CEO Jim Madden told investors on a conference call Thursday that its ability to win a contract with Bank of America Corp. last September and its ability to support Prudential's PeopleSoft-based HR system contributed to Prudential's decision to outsource its HR functions to Exult.

Although Exult is not hiring Prudential employees or acquiring any facilities as part of the deal, it can leverage the systems and employees gained from other contracts to serve Prudential and potential customers, says Paul Hamerman, a director with Giga Information Group. "Exult has the infrastructure and excess capacity in its service centers to take on this workload without acquiring additional assets."